The Collection Agency Says They’re Going To Garnish My Wages, Take My Car And Force Me To Sell My House To Pay My Debts: Can They Do That?

Collection agencies often use incredible scare tactics to get consumers to pay debts. They threaten to garnish wages, put liens on houses, take vehicles, and clean out your bank account.

What they don’t tell you is that in order to do any of these things, they have to get a judgment from a court of law first. That requires due process, and gives you an opportunity to stop them before anything egregious happens.

To get a judgment one must bring a lawsuit and give you a chance to be heard by a judge as to whether or not the debt is really owed. Only if you were to lose in court can the collection agency do anything about collecting the debt.

There are two solutions to the problem before it gets to that point. First, you can make a deal with the collection agency to pay them off. Usually they will accept monthly payments, or a lump sum. If that’s not possible, you can file bankruptcy and obtain a fresh start. In most cases, a Chapter 7 bankruptcy, and often a Chapter 13 bankruptcy, will discharge the debt entirely.

Douglas Jacobs is a California bankruptcy attorney and partner in the Chico law firm of Jacobs, Anderson, Potter & Chaplin. Since 1988, Mr. Jacobs has taught Constitutional law and Debtor-Creditor/Bankruptcy law at the Cal Northern School of Law. He has served as Dean of Students since 1994. He is a frequent lecturer on the subject of consumer bankruptcy law, and has spoken at both state and national levels.

This site does not create an attorney-client relationship and does not constitute legal advice. Each person's situation is different, you are encouraged to consult a licensed attorney in your state if you have questions about your situation.